Bet ramping hypo

[Running Count]

This came up below in a discussion of HiOpt2, but I thought up here people might respond more redily...

Here's the hypothetical: Spreading 1-5 on SD, DA2, NDAS, 70% pen. Two options for betting schedule based on the HiLo TC:
<table border="1" cellpad="4"><tr><td colspan="2">Low Variance Option</td><td colspan="2">High Variance Option</td></tr><tr><td>TC</td><td>Units Bet</td><td>TC</td><td>Units Bet</td></tr><tr><td><0</td><td>1 (or 0)</td><td><0</td><td>1 (or 0)</td></tr><tr><td>0</td><td>1</td><td>0</td><td>1</td></tr><tr><td>1</td><td>1</td><td>1</td><td>2</td></tr><tr><td>2</td><td>2</td><td>2</td><td>4</td></tr>
<tr><td>3</td><td>3</td><td>3</td><td>5</td></tr><tr><td>4</td><td>4</td><td>4</td><td>5</td></tr><tr><td>5</td><td>5</td><td>5</td><td>5</td></tr>
<tr><td>>5</td><td>5</td><td>>5</td><td>5</td></tr></table>

What's going to be the impact on overall expected return and variance of these two options? I'm wondering if the increase in risk of option 2 is worth the increase in $ per session. Can anyone point to a sim that shows this (or maybe even run one?)

Thanks,

RC

 

[illustrious bakedbean]

a related question

i'm wondering which of those two schedules the readership here would prefer, and under what circumstances.

thanks in advance.

 

[T-Hopper]

I have data for 5 rounds to 2 which is pretty close to 70%.

"Low Variance" spread
Win/100 3.92
SD/100 26.79

"High Variance" spread
Win/100 4.37
SD/100 30.75

My computer suggests a more conservative spread:
+2 2 units
+4 3 units
+5 4 units
+6 5 units

Win/100 3.68
SD/100 25.09

This has about the same ratio of EV to SD as your more conservative spread, but the ROR is much lower. With this spread you'd need 400 units for a 1% ROR; with your more aggressive spread 500 units would be required.

Your "High Variance" spread will take a little longer to get into the long run but I would recommend it anyway if your BR is more than 500 units.

I will soon be releasing software that does all of these calculations automatically, as well as fine-tuning the bet spread for your exact bankroll and preferred ROR.